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State Pension age will continue to be 66

Qualifying age for State pensions

January 5th , 2021.

The current qualifying age for all State pensions is 66. An increase to 67 in 2021 and to 68 in 2028 was planned. In Budget 2021, Minister for Public Expenditure and Reform, Michael McGrath announced that the qualifying age for a State pension will continue to be 66.

“I can confirm to the House that, in line with the Programme for Government commitment, the planned increase in the pension age to 67 on January 1st, 2021 will not proceed,” the Minister said. He said that a Pensions Commission would be established and that the Government would consider its eventual report “in due course”.

The last government announced plans to increase the age of retirement to 67 this year and 68 in 2028, but it became a major issue during the general election campaign.

In July last, the State’s budget watchdog, the Irish Fiscal Advisory Council (Ifac) said the current age of retirement left the public finances “on a vulnerable and unsustainable footing” and that it should be pushed out to reflect increasing levels of life expectancy and acknowledge the burden on a future workforce , which will have to support a growing number of pensioners.

In its first long-term sustainability report, the watchdog also warned that failure to increase the pension age as planned in 2021 would cost €575 million annually, with that figure rising over time. Ifac presented a model whereby people would work an additional eight months for every extra year of life expectancy. That would mean pushing the pension age out to 69 by the period 2035-2040 and that a

The difficult decision for Government was whether to allow the already decided age increase for the social welfare pension from 66 to 67 to stand. Subsequently , this led to the establishment of the Pensions Commission,  born of a need to delay any decision when the current Government was being formed.

Pending the commission’s report, it stays at age 66. For now.

For advice on retirement planning contact our trusted advisers on +353 1 7070 000 or email john.finnamore@seasprayfs.ie

Seaspray Financial Services trading as Seaspray Private and Seaspray Mortgages is regulated by the Central Bank of Ireland. Registered in Ireland number 582920.

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